{"id":6083,"date":"2026-05-19T17:36:00","date_gmt":"2026-05-19T17:36:00","guid":{"rendered":"https:\/\/www.aihello.com\/resources\/?p=6083---bf147d62-2faf-4b07-a669-06cff89fd3c7"},"modified":"2026-05-30T03:31:21","modified_gmt":"2026-05-30T03:31:21","slug":"what-is-amazon-acos-and-how-can-sellers-improve-it","status":"publish","type":"post","link":"https:\/\/www.aihello.com\/resources\/blog\/what-is-amazon-acos-and-how-can-sellers-improve-it\/","title":{"rendered":"What is amazon ACoS and how can sellers improve it ?"},"content":{"rendered":"

The Advertising Cost<\/a> of Sales, or ACoS<\/a>, is the amount of money you spend on advertising for every dollar of revenue you generate. It can also be thought of as the ratio of ad spend versus target sales.<\/p>

In Amazon PPC<\/a>, your Advertising Cost of Sales (ACoS) is crucial. It’s an important indicator for determining your Amazon advertising strategy. Your ACoS is a shaky metric for success that determines how you bid on search terms. ACoS is everything in Amazon PPC advertising<\/a>.<\/p>

A decent example of an ACoS computation is as follows: If your ACoS is 25%, you paid $0.25 for every dollar you made, or $25 for every $100 you made (we’re only looking at Ad Spend here, not production costs<\/a>, Amazon<\/a> fees, or anything else).<\/p>

Amazon ACoS<\/a> is a crucial metric for determining the success of your campaign.<\/p>

If you’re a seasoned PPC<\/a> marketer, you’ll see that Amazon borrowed this concept from Google Ads, which use Return on Ad Spend (ROAS). Here are some more Amazon<\/a> PPC vs. Google Ads pointers.<\/p>

But how do you tell if you have a good or bad ACoS<\/a>? Well, that\u2019s where break-even and target<\/a> ACoS come into play.<\/p>

How do you Calculate Break-Even ACoS?<\/h2>

The point at which your advertising<\/a> cost equals your profit<\/a> margin (you have a net loss \/ gain of $0) is called break-even ACoS. It provides an answer to the issue, “At what ACoS do you make no profit and no loss?” Let’s have a look at an example:<\/p>

Let’s imagine we had a toy vehicle with a $20 sale price and were paying $3 in Amazon fees<\/a> on it. Let’s say the cost of goods to manufacture the product is $6.<\/p>

When 20 minus 3 minus 6 is subtracted, what do we get? Our Pre-Ad Profit per Sale is $11 in this case.<\/p>

Now, if we spent all of those $11 on paid traffic to drive sales<\/a>, we’d do $11\/$20, or 55 percent, according to our ACoS calculation<\/a>.<\/p>

As a result, our break-even ACoS is 55%. We’ll be profitable if we don’t do more than 55 percent. We’ll be unprofitable if we do more than 55 percent.<\/p>

It’s crucial to understand how to<\/a> determine your break-even ACoS before deciding on your Target ACoS. Remember that a successful ACoS is determined by various things prior to your ad campaign, such as your profit margin and brand<\/a> visibility.<\/p>

What Does An Average, Low, And High Amazon ACoS Mean?<\/h2>

The Ideal Benchmark is Average ACoS.<\/h3>

Since the beginning of 2019, the average ACoS per user per day for Sponsored Product Ads<\/a> has been 34.42 percent, and it will continue to be such until 2022. This is an useful reference point because it lies in the centre of a high and low ACoS.<\/p>

April is generally the most profitable month for our advertisers, with the biggest amount of sales and the lowest ACoS (20%).<\/p>

A low ACoS indicates a high profit margin.<\/h3>

In general, sellers<\/a> agree that lowering your Amazon ACoS is a good idea. However, it is dependent on your product selling approach as well as your profit margin. We regard 15-25 percent to be a low ACoS and a decent place to start if you want to achieve one.<\/p>

However, you’ve undoubtedly heard the phrase “LOWER YOUR ACoS!” a lot. It’s true that lowering your Amazon ACoS can be beneficial, but only if it’s in line with your goals.<\/p>

It’s also a good idea to set a low ACoS if your aim is:<\/p>